The federal district court found that the additional insureds had to meet the policy’s self-insured retention before a duty to defend was triggered. Amerisure Ins. Co. v. Premier Design & Build Group, LLC, 2026 U.S. Dist. LEXXIS 170741 (N.D. Ill. July 31, 2026).

Amerisure issued CGL and umbrella policies to Premier Design & Build Group, LLC. Amerisure had the right and duty to defend in certain suits for property damage under both policies.

Premier contracted with MG East, LLC (MGE) to build three buildings. After the buildings were constructed, MG filed suit against Premier in state court, seeking recovery for allegedly defective installation of the roof, flashing, and gutters on each of the buildings. Premier had subcontracted with Tecta American Sough Florida, Inc. to install the flashing.

Under its contract with Premier, Tecta agreed that Premier would be an additional insured on its CGL policies issued by Starr Indemnity & Liability Insurance Company and Liberty Mutual Fire Insurance Company. Amerisure provided Premier a defense in MGE’s state court suit but argued that the defense should have been provided by Starr and Liberty Mutual under the policies they issued to Tecta. Amerisure brought this declaratory judgment action to clarify the parties’ duties to defend and indemnify Premier.

Starr and Liberty Mutual each moved to dismiss Amerisure’s complaint because the Starr and Liberty Mutual policies contained self-insured retention endorsements. The SIRs in each policy eliminated the duty to defend. Starr’s SIR stated, “We will have the right but not the duty to defend any ‘suit’ seeking those damages.” Likewise, the Liberty Mutual SIR read, “We will not have a duty to defend or investigate any claim or ‘suit’ seeking damages.”

Amerisure argued that the SIRs only applied to Tecta, not to any other insureds (such as Premier), and neither insurer was relieved of any duty to defend Premier. Both policies defined the term “you” as the named insured (Tecta). For example, the Starr SIR required ‘you” (that is, Tecta) to pay up to the retained limit, as well as any Allocated Loss Adjustment Expenses. But the fact that various provisions of the SIRs expressly referred to the named insured said nothing about the reach of other provisions that were not addressed exclusively to the named insured. In choosing to eliminate any duty to defend in “any suit” – not just suits brought against named insureds – the policies exempted Starr and Liberty Mutual from any duty to defend.

The court agreed with Starr and Liberty Mutual that interpreting “the insured” as it appeared in the SIR endorsements as only referring to the named insured, as Amerisure suggested, would lead to the unreasonable result that additional insureds would receive more protection under the policy than named insureds.

The issue of indemnification was not yet ripe because the underlying lawsuit between MGE and Premier had not yet been resolved.